TRUTH BE TOLD

Saturday, December 1, 2012

Treasury Department, U.S.

Treasury Department, U.S.

The Treasury Department traces its history back
to the tumult of the opening days of the Revolutionary War, when a
cash-strapped Continental Congress decided in 1775 to issue paper money
backed by nothing more than the promise of eventual repayment in coin,
and enlisted residents of Philadelphia to number and count the bills.
The department was formally created by Congress in 1789. The first
Secretary of the Treasury was Alexander Hamilton, who shortly after
being appointed took the bold move of proposing that the federal
government assume the wartime debt of the states and pay them off in
full.
In the more than 200 years since, Hamilton's heirs have at times been
among the most powerful figures in government, for better or worse.
During the Civil War, Salmon P. Chase created the "greenback" paper
currency that fueled the North's victory; Andrew W. Mellon helped bring
on the Great Depression by his advice to President Hebert Hoover to cut
spending and raise taxes during an economic downturn; after World War
II, Henry Morgenthau, Jr., helped create a new system of international
finance by leading the conference that created the International
Monetary Fund and the World Bank.
President Clinton relied heavily on the advice of Robert E. Rubin,
setting aside his desire for an economic stimulus package in favor of a
mix of spending cuts and tax increases in 1993. Neither of President
Bush's first two secretaries of the treasury, Paul O'Neill and John W.
Snow, played much of a role in shaping administration policy, and both
were pushed from office. Their successor, Henry M. Paulson Jr., saw his
role increase along with the severity of the ills facing Wall Street
after the mortgage market collapsed beginning in 2007. Since taking
office in January 2009, Treasury Secretary Timothy F. Geithner has
played a central role in developing the Obama administration's policies
on stemming foreclosures and stabilizing the banking system.